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Cisco Clears Web-Based App Path

UPDATED: To improve its offerings for corporate data center operators, Cisco today said it will buy FineGround Networks for $70 million.

It's the latest in a series of acquisitions by network equipment players that are turning to privately held firms for technology that augments their existing products.

FineGround network appliances improve user response times by up to five times, reduce application bandwidth usage by up to 90 percent, and reduce the load on servers by up to 90 percent.

The buy "enhances Cisco's strategy to converge application acceleration, security and a highly available network infrastructure seamlessly in the data center," Jayshree Ullal, general manager of Cisco's security technology group, said in a statement.

FineGround also recently took its Web application delivery abilities to the storage space. Last month, the company began offering a new wide area file services (WAFS) that allows users to share and store files from one box in a data center.

WAFS is an emerging field in the storage sector that lets users access a remote data center as though it were local. Cisco bought Actona last year to gain a foothold in WAFS.

FineGround, of Campbell, Calif., is privately held and venture-backed. The firm will become part of Cisco's security technology group and CEO Nat Kuasik will continue to lead the team of 42 employees.

Its products will be sold through Cisco sales and channels, and its technology will be integrated with Cisco's ongoing development in this area.

For Cisco, the acquisition is the latest in a series. The San Jose, Calif., giant continues to pick up smaller networking companies with established products that it can integrate or package with its switches and routers.

For example, last month, Cisco paid $68 million for consumer Voice over IP technology provider Sipura Technology.

Other Cisco acquisitions in 2005 include wireless local area network gear maker Airespace and grid computing specialist Topspin.

The buying spree is being mirrored by Cisco competitors, including Nortel and Juniper Networks , which recently agreed to pay a total of $449 million for startups Peribit and Redline.